Monday, October 15, 2007
Khulumani v. Barclay National Bank Ltd.
On Friday, October 12, a panel of the U.S. Court of Appeals for the Second Circuit issued its decision in Khulumani v. Barclay National Bank Ltd. (Nos. 05-2141 & 05-2326). (New York Times story here; Reuters story here; Bloomberg story here.) Plaintiffs sued dozens of major corporations, both U.S. and foreign, alleging liability for aiding and abetting the South African system of apartheid. (See the complaint here.) The district court (District Judge Sprizzo of the U.S. District Court for the Southern District of New York) dismissed the plaintiffs' claims under the Alien Tort Statute (absence of subject matter jurisdiction) and the Torture Victim Protection Act (failure to state a claim). On appeal, a unanimous panel (Circuit Judges Katzmann and Hall, and District Judge Korman, sitting by designation) affirmed dismissal of the TVPA claims, but a divided court (Judge Korman, dissenting) vacated the district court's dismissal of the ATS claims. A per curiam opinion set out the decision; each of the three panelists wrote separately. Notably, though reaching the same result, Judges Katzmann and Hall disagreed as to the applicable law for determining accessorial liability under the ATS: Judge Katzmann applied international law, while Judge Hall applied federal common law. Having found subject matter jurisdiction under the ATS, there remain a number of difficult issues for the district court to resolve on remand, including whether to dismiss the case on prudential grounds and whether the plaintiffs have stated a cause of action under the ATS.